On March 2, 2012, the federal judge presiding over the lawsuit challenging the new NLRB rule requiring union and non-union employers to notify employees of their rights under the National Labor Relations Act (“NLRA”) ruled the NLRB had legal authority to adopt the posting rule. The court rejected the argument that the notice posting requirement violated employers’ First Amendment rights.

However, the court found the NLRB exceeded its authority with respect to two parts of the rule. The court invalidated the portion of the rule providing that the failure to post the notice was always an unfair labor practice, stating the NLRB could not “make a blanket advance determination that a failure to post will always constitute an unfair labor practice.” But the court said the NLRB could find a failure to post the notice was an unfair labor practice if the NLRB made “a specific finding based on the facts and circumstances in the individual case before it that the failure to post interfered with the employee’s exercise of his or her rights.”

Likewise, the court held that the NLRB did not have authority to force employers who do not post the notice to prove that the six-month statute of limitations should not be tolled. But the court again said its ruling “does not prevent the [NLRB] from considering an employer’s failure to post the employee rights notice in evaluating a plaintiff’s equitable tolling defense in an individual case before it.”

At bottom, the court disagreed with the NLRB’s attempt to “predetermine” the consequences of failing to post the notice in all cases. But the court gave the NLRB discretion to impose consequences (including finding an unfair labor practice or tolling the statute of limitations) based on the facts of a given case.

The rule and notice requirements were outlined in Taft’s September 2011 bulletin. The effective date of the new posting rule has been postponed twice so legal challenges to the rule could be resolved. The rule is currently scheduled to become effective April 30, 2012. An appeal of the district judge’s March 2 ruling could cause further delay.

For additional information, please contact a member of Taft’s labor and employment group.